Governments and banks encourage people to accumulate debt by spending money on unnecessary items and discourages investing and accumulating wealth. The economy relies on people exchanging their time for money that is often not sufficient to live off of and taxed by the government. The government wants people to spend their earnings on items that deteriorate and encourages borrowing to keep the economy healthy.
Debt and Consumption: The Government and Big Banks’ Motives
When it comes to personal finances, it’s important to understand the motives behind the messages we receive from governments and big banks. The common rhetoric we hear is that we need to spend money to keep the economy healthy, but why is that?
The Push for Debt
It’s no secret that governments and big banks want people in debt. They want us to take out loans and spend money we don’t have on things we don’t need. Why? Because debt creates interest, and interest means profit for banks. In addition, debt keeps people working and paying taxes, which benefits the government.
The Disincentive for Investment and Accumulation of Wealth
Furthermore, the push for debt often comes at the expense of investing and accumulating wealth. Governments and big banks don’t necessarily want people to become financially independent, as that would mean less reliance on debt and interest. They want people to keep spending, to keep money flowing through the economy.
The Traditional View of a Healthy Economy
The traditional view of a healthy economy involves people constantly trading their time and non-renewable resources for an uncertain supply of money. Governments tax that money, with the intention of putting it back into circulation through spending. They want people to keep spending to create more money, and to keep taking out loans to keep that money circulating.
The Bottom Line
It’s essential to understand how governments and big banks benefit from our spending habits and accumulation of debt. While it may seem like personal responsibility to pay off debt and manage our finances, it’s important to recognize the systemic factors at play. Stay informed and make decisions that align with your financial goals and values.